Maximising The Claim For Business Expenses |
Make sure you claim the right expenses ... |
POSTED BY HELEN BEAUMONT ON 10/04/2019 @ 8:00AM
If you're reviewing your profit and loss report, ensure you deduct all allowable business expenses ...
When updating your profit and loss, ensure you know what business expenses you can and cannot claim!
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Many business owners get confused as to what can (and cannot) be deducted. To ensure the maximum allowable deductions, be sure that you:
know the rules
know what is and what isn't deductible
understand what reliefs are available
keep good records
Remember the 'wholly and exclusively' rule where an expense should exclusively be for the purpose of your business. For example, you can claim workwear such as hiviz or personal protective gear, but you wouldn't be able to claim a nice dress because you could wear it for non-business purposes and is required for common decency.
The trade portion of a private expense can be claimed if it can be proven that part of the expense was used for business. For example, if you work from home, then a portion of your telephone and electricity bills could be claimed, as could a percentage of other household bills if they were considered to be for the purposes of your business.
Be careful what you put through your business account too. As an example, if you are self-employed and go out for lunch with a friend, pay via a private bank account as putting it through the business bank account would mean the lunch isn't deductible.
And also ensure that when you buy something for your business (stationary as an example) then don't make a personal purchase at the same time and try to put the whole thing through as a business expense. HMRC may disallow the whole transaction if they discover it.
It is good practice to always keep your business and personal expenditure separate. Use a business bank account and a personal bank account, and ensure you put the right expenses through the right account!
"Would you like to know more?"
If you'd like to find out more about business expenses and what can (and cannot) be claimed, then do give me a call on 01908 774323 or click here to ping me an email and let's see how I can help you.
Until next time ...
HELEN BEAUMONT
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